CATA News

William “Bill” Walsh, Sr., 83, passed away on Wednesday, Oct. 26, 2022. Walsh was founder and president of the Bill Walsh Automotive Group from 1963 until his death. Representing seven automotive franchises, the Bill Walsh Automotive Group had locations in Ottawa, Peru and Streator, Ill. In lieu of flowers or gifts, memorials may be directed to The Child Welfare Guild, PO Box 456 Ottawa, 61350, Pet Project, PO Box 163, Ottawa, 61350.

[From CATA Allied Member Utility Management Group] Natural gas prices have been receiving much attention lately as over the past 24 months we’ve seen two significant changes to the market. The first is an increase of pricing. As of late, depending on the month, prices are two to four times what they were two years ago. The second is the volatility of the market. The NGI Index, or the standardized price of natural gas for the Chicago market this year has ranged from $.4535 to $.879. It’s not uncommon for us to see the daily price of gas range from the low $.50’s to the low $.90’s within a 30 day period.

Locking rates for a percentage of your usage is a tool which can provide some budget certainty. When the market is stable which day you lock rates is not as important as the change in rates day to day is not significant. Selecting a day to lock rates with the volatility we’re experiencing becomes more difficult as rates can vary greatly from day to day. If you’d like to lock rates now or in the future we have two suggestions which address the current volatility.

The first is to utilize strike prices, where a target rate and percentage of use you’d like to lock is submitted to the supplier. The supplier watches the market daily and if your price is hit you have the option to either have the lock executed automatically or to be notified, giving you the choice to execute the lock or continue to watch the market. You have the option to be notified only if your price is hit, which is what most customers choose or to receive daily pricing.

The second suggestion is to start watching the market early. You may have fixed rates in place for the next year or so, but rates further out are much lower than near term rates making them more favorable and there’s no risk to submitting a strike price. Watching the market early gives you the opportunity to capitalize on a drop you may have otherwise missed. What we look for in suppliers is not only the option to offer a strike price, but the ability for their system to do it as an automated process as a manual process is difficult and time consuming for the supplier and drops in the market can be missed.

With the factors driving the market being unpredictable, no one can know what prices will do going forward or when this volatility will end, making these types of tools important in controlling your costs. If you have any questions regarding this or any energy related issue, please contact our office at 630-279-0117.

You may have received a call from the CATA asking you to sign a NADA PAC permission form. Signing this permission form is crucial to the success of the mission of NADA PAC. But do you even know what NADA PAC is?

NADA PAC, a federal political action committee sponsored by NADA, helps elect qualified individuals to Congress who understand the needs of new car and truck dealers. In the 2020 election cycle, NADA PAC was credited as being one of the nation's top three largest trade association political action committees in terms of both total fundraising and contributions to federal candidates. NADA PAC supports candidates for Congress based on the recommendations of CATA leadership.

To find out more about NADA PAC and its support of pro-dealer candidates, please call Dave Sloan at the CATA at 630-424-6055. If CATA doesn’t already have your NADA PAC permission on file, please find the form here and submit it to NADA.

Amie Lindaas, Director of Research & Insights at Chicago-based Cars.com, presented an interesting study at the recent Chicago Drives Electric event. The study took at deep dive into EV considerations among Cars.com shoppers, specifically citing the differences between male and female intenders. The study found that male shoppers were significantly more likely to be considering EVs. In addition, the study provides key insights into the mind of the EV shopper that dealers may find useful when selling EVs. Click here to download the study.

There is cause for concern regarding the prospects for the Chicago Area new vehicle market. Supply chain issues continue to limit inventories, inflation is surging, interest rates are moving higher, economic growth has turned negative, and consumer sentiment is weak. It’s a formidable list. But there are two key positives that will likely prevent deterioration in current sales rates and should provide a boost when supply issues abate and the economic picture brightens. Click here for the third quarter 2022 Chicago Auto Outlook.

The nomination of Ray Scarpelli, dealer principal at Ray Chevrolet and Ray Chrysler Dodge Jeep Ram in Fox Lake, Illinois, for the 2023 TIME Dealer of the Year award was announced today by TIME.

Scarpelli is one of a select group of 48 dealer nominees from across the country who will be honored at the 106th annual National Automobile Dealers Association (NADA) Show in Dallas, Texas, on January 27, 2023.

The TIME Dealer of the Year award is one of the automobile industry’s most prestigious and highly coveted honors. The award recognizes the nation’s most successful auto dealers who also demonstrate a long-standing commitment to community service. Scarpelli was chosen to represent the Chicago Automobile Trade Association (CATA) in the national competition – one of only 48 auto dealers nominated for the 54th annual award from more than 16,000 nationwide.

“The lessons I have learned in the retail auto business and the people I have been lucky enough to know and work with have all contributed to the foundation of who I am today,” nominee Scarpelli said.

A 1984 graduate of Northwood University in Midland, Michigan, where he studied automotive marketing and management, Scarpelli has always been fascinated by cars. His father, Raymond Scarpelli Sr., owned a Chevrolet and Oldsmobile store, and Scarpelli relished his time there as a child.

“From an early age, my dad set an example that you should treat your customers the way you would want to be treated,” Scarpelli said. “Of course, it made all the sense in the world.”

Scarpelli later moved into the service department, was a lot attendant, washed cars and worked in the body shop. When it came time to look for a college, he let his passion for autos drive his decision. He chose Northwood University, where he could learn automotive marketing, management, accounting, service, parts and general operations – all the tools he would need to run a successful dealership. He also participated in hands-on activities, like the student-run outdoor Northwood University International Auto Show.

After college, Scarpelli worked in sales at his family’s Raymond Chevrolet Oldsmobile and continued his real-world education. He worked his way up through the ranks to become dealer principal of Ray Chevrolet and Ray Chrysler Dodge Jeep Ram in Fox Lake.

Over time, Scarpelli worked hard to grow the family business, adding key employees and improving customer satisfaction and service. He and his wife, Lisa, have two children who are now part of the dealership operation and the next generation to join the family business. He and his family also are active members of the Fox Lake community, and they reside in a town near the dealerships.

Scarpelli has held leadership positions for the CATA and served as chair of the Chicago Auto Show in 2019, overseeing the First Look for Charity black-tie gala. This popular fundraising event attracts car enthusiasts who also have a passion for philanthropy.

“In 2019, we raised $2.8 million for our charity partners, all of which are in the local area,” he said. “I was personally involved in selecting Catholic Charities of the Archdiocese of Chicago as a beneficiary.”

Other groups that benefitted from the successful event include Ann & Robert H. Lurie Children’s Hospital of Chicago, Boys & Girls Clubs of Chicago, Special Olympics Illinois and Turning Pointe Autism Foundation, among others.

Scarpelli is also proud of the partnerships he has created to support community nonprofit groups, organizations and schools. One of his favorites is the Big Play Program which rewards four local high schools by donating $25 for each “big play” achieved, including home runs, touchdowns, soccer goals and others.

“Over the years, we have donated more than $350,000 to support student athletes,” he said.

When the McHenry Outdoor Theater, a drive-in located in McHenry, Illinois, reopened following pandemic restrictions, Ray Chevrolet treated 350 families to tickets to a free movie. Scarpelli was also an early champion of the CATA’s USO Barbecue for the Troops fundraising initiative that, over the years, has collectively raised more than $1 million to support USO Illinois, local military and their families.

In addition, he hosts quarterly blood drives for Versiti Blood Center of Illinois; Toys for Tots toy drives; Christmas parties for children in-need; food drives to support Grant Township Food Pantry; and donates vehicles to driver’s education programs and to local police departments.

“Our greatest strength is our relationship with the community,” he said. “And our friends, customers and neighbors are an extension of our family.”

Dealers are nominated by the executives of state and metro dealer associations around the country. A panel of faculty members from the Tauber Institute for Global Operations at the University of Michigan will select one finalist from each of the four NADA regions and one national Dealer of the Year. Three finalists will receive $5,000 for their favorite charities and the winner will receive $10,000 to give to charity, donated by Ally.

In its 12th year as exclusive sponsor, Ally also will recognize dealer nominees and their community efforts by contributing $1,000 to each nominee’s 501(c)3 charity of choice. Nominees will be recognized on AllyDealerHeroes.com, which highlights the philanthropic contributions and achievements of TIME Dealer of the Year nominees.

“For over 50 years, TIME has been committed to recognizing the impact of automotive dealers on their communities with the TIME Dealer of the Year award," said Edward Felsenthal, editor in chief and CEO, TIME. "We are proud to continue the legacy of honoring these works of service with our partners at Ally.”

Doug Timmerman, president of dealer financial services, Ally, said, “Auto dealers across the country who are nominated for this award each year are committed to not only doing it right and leading in a rapidly changing automotive industry but to strengthening their communities through giving back. The TIME Dealer of the Year program celebrates dealers who are the role models of the retail auto industry for their continuous efforts to lift up and support their employees, customers and communities.”

Scarpelli was nominated for the TIME Dealer of the Year award by the CATA Board of Directors. For more information, visit TIME Dealer of the Year.

A couple weeks ago, the CATA hosted its first-ever Chicago Drives Electric program which brought together media, dealer members, policymakers and consumers to provide EV education and spotlight the critical role franchised dealers will play in the adoption of EVs. The CATA partnered with the Midwest Automotive Media Association to bring in national and local media members to hear from independent research firm, Escalent. In addition, every local TV broadcast station came onsite to learn and capture expert interviews and footage. According to Escalent’s 2022 EVForward Dealer DeepDive study, franchised dealers will remain a pivotal part of an EV intender's shopping experience. The DeepDive survey found that 74 percent of respondents prefer to buy an EV at a dealership, rather than from an auto manufacturer or third party. This research proves that the franchise dealership model works just as well for EVs as it does for traditional vehicles, a message the CATA made clear to media, policymakers and consumers. In addition, this next stage of EV adoption will mean getting everyday consumers into mass-market vehicles, and new-car dealerships will be critical to this process.

The following day, the CATA hosted its dealer members for a half-day session to gather EV business strategies and network with a handful of experts. Cars.com opened the morning with a discussion on “Customer Insights and Retail Strategies for the EV Future.” Following, a panel discussion focused on preparing dealers for the EV revolution and strategies on how to make the wisest business decisions to best adapt. A variety of topics were addressed ranging from how dealers can select the right EV charging solution/find efficiencies in the process, own their energy with solar, service considerations around BEVs and ideas for creating new business opportunities/sources of revenue into the future. Experts included Charge Enterprise VP OEM, Dealer and Commercial Development Mark Buzzell; Powering Chicago’s Gina Dooley; PLEMCo CEO Brad Rinehart; and Solar One Director of Commercial Development Michael Stonesifer.

Over the course of the weekend, the event opened to pre-registered consumers to test drive, experience and learn about the latest BEVs, hybrids and plug-in hybrids. Featured brands and vehicles included: Alfa Romeo Tonale; Chrysler Pacifica PHEV; Chevrolet Bolt EV; Chevrolet Bolt EUV; Ford F-150 Lightning; Ford Mustang Mach-E; Ford E-transit; Hyundai IONIQ 5; Hyundai Santa Fe PHEV; Hyundai Tucson PHEV; Hyundai Kona EV; Jeep Grand Cherokee 4xe PHEV; Jeep Wrangler 4xe PHEV; Kia EV6; Volkswagen ID.4; Volvo C40 Recharge; Volvo XC40 Recharge; Volvo XC60 Recharge PHEV; and Volvo XC90 Recharge PHEV.

In addition to putting interested parties behind the wheel of some of the latest EVs, the CATA brought in a variety of experts to help break down the various aspects of EV ownership and tackle complex topics such as range anxiety; at-home charging solutions; on-the-go charging and infrastructure; tax credits and incentives; and where people can begin their search. On-hand experts included Cars.com, Charge Enterprises, ComEd and Powering Chicago.

The event surpassed expectations: the CATA anticipated a range of 750-1,000 attendees. Over the course of the weekend, the event netted 947 total registered drivers and nearly 3,000 in-vehicle experiences, surpassing expectations. The buzz generated from the event carried over to social media; Chicago Drives Electric reached 4.5 million, according to initial results from media measurement firm Meltwater.

“We invited previous Chicago Auto Show ticket purchasers, in the form of one email, to preregister for their preferred date and two-hour timeslot,” said CATA Chairman JC Phelan. “We were shocked to find all the timeslots filled overnight! The response and interest were overwhelming, in a very good way, which is why we’re looking to enhance our indoor EV track at the Chicago Auto Show and incorporate elements of Chicago Drives Electric including consumer education and resources.”

“We’re planning to triple the size of our indoor EV track, adding more brands and vehicles, and building out the surrounding area with educational exhibits and panel discussions featuring industry experts,” said Chicago Auto Show Co-General Manager Jennifer Morand. “All of that rich content will translate well to social media where we’ll take in-person panel discussions and broadcast them live on our Facebook and Instagram channels, create educational Instagram Reels and TikTok videos, and partner with key influencers in the space to take over our social media channels throughout the show.” 

“Chicago Drives Electric validated to us the public’s enthusiasm to further their knowledge about EVs,” continued Morand. “There are many complexities associated with the topic, which is why personal service and education is needed now more than ever, and the Chicagoland new-car dealers are dedicated to assisting consumers in their EV journey.”

CATA counsel has received questions regarding mechanics' liens. The statute provides that the dealer must retain possession of the car in order for the lien to be in place. It does not provide for placing an actual lien on the title to the car or fifing a lien with the Recorder of Deeds Office. If the customer does not pick up the car and pay the bill within 90 days after the work has been completed, then the dealer can sell the car at a public or private sale after providing 30 days’ notice to the customer.

Problems arise when the customer who requested the service picks up the car but refuses to pay the bill. Under the statute, once the dealer voluntarily delivers the car to the customer, he loses the lien. The dealer's only recourse then Is to file a lawsuit to recover his expenses.

If the dealer is forced to deliver the car (for example, by law enforcement personnel) an argument may be made that the dealer did not "voluntarily" give up possession of the car and the lien remains in place. In this instance, the dealer would still have to file a lawsuit to enforce the lien.

Mechanics’ Lien Law & Foreclosure Process

Nearly all new-car dealerships are facing manufacturer-mandated EV charger installations over the next few months. This process can be both daunting and expensive. Powering Chicago, a partnership between the International Brotherhood of Electrical Workers (IBEW) Local 134 electricians and the Electrical Contractors’ Association (ECA) of Chicago and Cook County, wants to make that process slightly less daunting by providing an e-book that breaks down the process from design to implementation.

Download Powering Chicago e-book

[from NADA] NADA recently reminded members about potential legal issues that arise when dealers charge documentary or other fees to consumers who exercise an option to purchase at the end of their lease agreement when those fees are not provided for in the lease agreement. This issue continues to draw scrutiny, and NADA would like to remind dealers about the importance of consulting with their legal counsel about any contractual and regulatory obligations that could arise in connection with consumer fees charged with lease-end vehicle purchases.

In order to more fully explain the requirements and limitations that apply to fees that a dealer may charge a lessee who exercises an option to purchase, we have set forth below the relevant excerpt from NADA’s A Dealer Guide to Federal Consumer Leasing Act Requirements. As the excerpt generally explains –

The excerpt provides important details regarding these limitations. Dealers are encouraged to review with legal counsel their current procedures for handling options to purchase leased vehicles.